Investors are flocking into the bubble tea market since demand is booming across the country. Market researchers have found the market is growing at 20 per cent a year and reached US$300 million two years ago. There are over 100 brands already and many more famous names are flocking in.
In large cities like HCM City and Hà Nội, it is easy to find bubble tea stores belonging to major brands like Alley, Gongcha, Phúc Long, Ten Ren, and Royaltea.
There are also smaller stores with cheaper prices run by small business people.
Seeing the demand, many coffee chains like Highlands and The Coffee House and restaurants have added bubble tea to their menu.
Besides bubble tea simply being a popular drink for various age groups, the shops selling it have become a haunt for youngsters because of their facilities and decor.
A spokesperson for a famous brand name, Gong Cha, said: “Competition in bubble tea market in Việt Nam is a marathon.
“Bubble tea has established itself on the Vietnamese food and drink scene. Bubble tea shops are no longer just places selling beverages. They are places featuring a speciality totally different from traditional places like coffee stores and restaurants.”
Brand expert Võ Văn Quang was quoted as saying by Người Lao Động (The Labourer) newspaper that the popular drink in Hong Kong and Taiwan has undergone many changes in the Vietnamese market with many toppings to match Vietnamese tastes.
“Milk tea is now a popular drink among Vietnamese youth.”
Most of the milk tea brands have come to Việt Nam as franchises, he said.
“At prices of VNĐ30,000 to over VNĐ80,000, bubble tea is brining huge profits. That is why foreign brands are keen on franchising in Việt Nam.”
A bubble tea shop is much cheaper to set up than a coffee shop while the profits are huge, he said.
Dr Đào Duy Khương, a retail expert, said milk tea, unlike coffee and tea, targets youths in big cities, and this demographic’s consumption behaviour is trendy meaning investors should change their offerings frequently.
It is not surprising several brands closed in recent times, he added.